Citigroup's Trust Issues

Citigroup has never been bashful about going big. Between the bank's losses, Andrew Hall's bonus, and the new $50 million corporate jet that almost was, modesty is not exactly in abundance in Vikula's empire. So it should come as no surprise that when Citi needed a lobbyist to advance its efforts to get Sandy Weill back on the Top 400 list, it went all out and enlisted the services of Richard Hohlt, who some blame for single-handedly exacerbating the S&L crisis. Having reneged on promises to regulators about supporting legislation to recapitalize the S&L industry in his younger days, Dick Parsons thought Hohlt would be a perfect fit for Citi. Others have a slightly different take.

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"Mr. Hohlt has a track record as a behind-the-scenes, Republican influence peddler who caused severe damage to U.S. citizens by helping to delay and weaken the crackdown on the S.& L. control frauds," says William K. Black, a former regulator and a top investigator for the definitive Congressional report on the S.& L. crisis. "It is singularly obscene that any recipient of taxpayer assistance through the TARP program during the current financial crisis would hire one of the most infamous lobbyists in the world to represent them," says Mr. Black, who now is a professor of law at the University of Missouri at Kansas City.

After Pandito himself promised in February during the bank CEO witch trials, "We understand that the old model of corporate behavior no longer works. (...) I get it, and I will see that Citi gets it", it looks like Hohlt isn't the only one going back on his word.Citigroup Hires Mr. Inside [NYT]